The Smart Grid is the hottest thing in Green IT these days, attracting not just lots of press, but attention from heavyweights like Cisco, IBM, Intel, and Google. There's also plenty of venture capital money chasing the Next Big Thing -- but there's some evidence that the Smart Grid may be the next tech bubble to burst.
The Smart Grid is about more than just electricity. The grid will carry data as well as power, and the devices on it will be intelligent. So it will be used in enterprises for data gathering and environmental control, in addition to controlling power.

Billions of dollars will soon start pouring into Smart Grid development, from big companies like Cisco, IBM, Intel, and Google, as well as from the federal government, which will spend billions of dollars by itself for the Smart Grid.

Not surprisingly, the venture capital community smells a killing, so it's spending money there as well. But at least one venture capitalist warns that there may be a bubble in the making -- and bubbles always burst.

According to CNet, Diana Propper, a clean-tech venture capitalist at Expansion Capital Partners, said this at a recent panel:
"I worry that there's so much money being sloshed around, whether it's venture capital or corporate or government money, that it will be spent inefficiently. The risk of a bubble is real."
On the other hand, a bubble isn't always a bad thing. In fact, Internet pioneer, 3COM founder, and Ethernet inventor Robert Metcalfe, believes bubbles are good things. Metcalfe is involved in green tech these days, and he argues that bubbles mean that a particular technology gets all the investment and attention that it needs in order to thrive. Although some people lose money during bubbles, he says ultimately it's good for the technology and the economy as a whole.

So will there be a Smart Grid bubble? Most likely, although it's not clear how large a bubble it will be. But Metcalfe is probably right -- the bubble means that the grid will actually become reality.

Bubble photo CC-licensed by Flickr user Jeff Kubina .